Know how to handle a senior resignation

There are some leaders who are so iconic that life without them would be unimaginable – and this is as true of the business world as of the political or cultural world.

Yet business leaders are as entitled to their retirement as the rest of us, and while we may think that they eat, sleep and breathe one particular organisation, they are as likely as their junior colleagues to be planning their next career move.

Every company will have to deal with the resignation of a senior and often much-admired figure, so it’s worth getting provision in place well in advance.

According to Gareth English, senior consultant at business psychologist OPP, when a senior figure leaves, employers need to recognise the impact it has on those left behind.

Grieving teams

“A process similar to a grieving cycle will often occur during a major change like this,” he says. “It’s particularly important for employers to remember that they have probably had more time to come to terms with this than their teams.” So what should HR be doing to ensure that staff don’t follow their departing boss?

“The support employees need will depend on what the person leaving provided,” says English. “If they were an operational manager, they may leave a vacuum. If they were a hero figure, their departure may cause a fall in motivation and drive.”

As with so much of corporate life, communication is the key. Senior staff will generally have to work a long notice period, so it is important to communicate the news of their departure as early as possible.

Before making the announcement, decide what to tell staff in terms of the recruitment process. Let them know what you are doing to replace their boss, and tell them what type of person you are looking for.

Make sure remaining staff are confident that you are looking for the best possible leader for them, but as English says: “Don’t rely on replacing your leaders like-for-like. Look at how you can fill their role from within the company, and then augment what is left with an external hire. This can be a great opportunity to develop the roles of other staff.”

Regardless of how sudden a senior resignation is, you should already have a good idea of potential replacements, and it’s crucial that you draw up a succession pool – for filling gaps as much as for building morale and keeping ambitious staff engaged.

By recruiting someone internally, you can avoid some of the usual problems around bringing in an external candidate: they will know people, will already share the company culture, and won’t need a couple of months to settle in.

Watch your back

At the same time, keep an eye on competitors. Ask your senior staff for feedback on people they’ve met while networking – having a list of potential external candidates could save you a considerable amount of time and money if you have a gap to fill. And make sure that you know what packages your competitors are offering – you will have to pay well if you want to attract the best applicants.

According to our research report, Business Exposure, more than 80% of organisations have no meaningful contingency plans for a senior level resignation. The impact can be severe, with up to 60% reporting team instability, loss of momentum and knowledge, delays to projects and decisions, uncertainty among customers, and competitors taking advantage.

What should you avoid doing?

Don’t delay appointing a replacement: the longer there is a leadership vacuum, the more damaging its effects.

Top tips

Treat unexpected senior resignations as a fact of life, not something you hope won’t happen – 38% of companies have faced this situation in the past year. A robust succession plan is essential from at least director level up, or even the top three layers.

Conduct an audit of key roles that quantifies their business impact and the difficulty of recruitment, to prioritise where a successor is most important. Have an interim management provider to hand, so that you can bridge the gap quickly.

Consider the speed of recruitment. Headhunting, where a highly confidential search aims to pluck someone directly out of a competitor company, can be slow and costly even for executive roles. Ask your recruiter how long it will take to draw up a shortlist, and if the answer is more than a few weeks, look elsewhere.